A new law passed on Monday in China will inhibit for-private-profit schools from benefiting from the nine-year compulsory system. The law was passed at the end of the Standing Committee for the National People's Congress.

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Under the new law, private schools will also be required to adhere to a nine-year free education plan from elementary to junior high school. All expenses in regards to that are fully catered for by the central government.

China's Ministry of Education believes that the nine-year compulsory system is a necessity. This is ideally because the education system should work in accordance with the state's policies while reflecting fairness with the public's interest at heart.

"The system is a public service that must be provided by the government," said Vice Minister of Education Zhu Zhiwen. "Private schools are still allowed to offer diversified, market-oriented paid educational services as long as they comply with the law."

Come September 1, 2017, the new law is expected to come into effect. Both for-profit and non-profit private schools are mentioned with measures put in place to support both private schools. Non-profit private schools will be considered equals in terms of land use and taxation with public schools.

This comes at a time when the education system is a hotbed of investment and is also the least regulated body in China.

"Generally, private schools gain a return of 25% in profit," said Wang Tongsheng, an official from the education bureau of Lianjiang County. "With the new law, a loss should be expected."

Wang further added that the loss might discourage investors from starting new private schools. Existing institutions may face difficulties in covering operation cost as well.

Tagschina, NPC Standing Committee, education, Nine year compulsory system